The Shift from Credential Theft to Trust Manipulation in Identity-Based Cyber Threats 2025

Observation Summary: Identity-Based Attacks Now Dominate Global Cyber Incidents

Over the past quarter, ProArch’s global telemetry and Microsoft Threat Intelligence feeds have identified a significant surge in identity-based cyber attacks, which now account for more than 75% of global cyber incidents (Microsoft Security Blog, 2025).

These attacks are no longer limited to stolen credentials – adversaries now manipulate trust itself through tactics like Adversary-in-the-Middle (AiTM) phishing, OAuth consent abuse, and AI-generated lures.

A recent case involving a BFSI client demonstrated the effectiveness of ProArch’s Managed Detection and Response Services, resulting in a 40% reduction in identity-related incidents and over $1.2M in prevented losses.

This escalation underscores a chilling reality: in today’s digital landscape, trust can become the ultimate vulnerability.

Why Identity Attack Are Evolving: From Credential Theft to Trust Manipulation

Attackers are evolving faster than traditional authentication defences. Recent threat intelligence highlights both pre-compromise and post-compromise identity attack techniques used to breach organizations silently and persistently.

Pre-Compromise Identity Attack Techniques

• Adversary-in-the-Middle (AiTM) Phishing: Attackers host fake login portals that intercept both credentials and MFA tokens, rendering traditional MFA ineffective (Blancaflor et al., 2025).
• OAuth Consent Phishing: Malicious applications deceive users into granting access, bypassing password-based controls. Over 120 vulnerable platforms were exploited in 2025 (Luo et al., 2025).
• AI-Generated Phishing Lures: Using generative AI, attackers craft hyper-realistic emails tailored to organizational context, bypassing legacy spam filters (Crypto-Gram Newsletter, 2025).

Post-Compromise Identity Attack Techniques

• MFA Fatigue: Attackers bombard users with repeated MFA prompts until they inadvertently approve access, as seen in multiple large-scale enterprise breaches (Gayatri et al., 2025).
• Session Token Theft & Replay: Adversaries steal active session tokens, allowing lateral movement without re-authentication (Mimecast Threat Intelligence, 2025).

Real-World Example: ProArch’s Identity Threat Detection for BFSI

Through Microsoft Sentinel, Defender XDR, MDE, and Azure AD Identity Protection, ProArch analysts have mapped and mitigated these attack paths.

In a BFSI use case, OAuth abuse was detected within four hours, and token replay anomalies were contained with UEBA-driven detection, reducing response time by 60%.

Why Identity Security Fails: The Risks of Trust-Based Exploits

When identity systems are compromised, attackers inherit legitimate trust, enabling:

• Lateral movement across systems undetected.
• Privilege escalation, granting admin access to sensitive data.
• Business disruption, including halted operations and data corruption.
• Regulatory exposure, risking compliance violations under GDPR, HIPAA, or PCI DSS.
• Financial impact, with potential multimillion-dollar recovery and loss costs.

For clients across BFSI, healthcare, manufacturing, and technology, these risks translate into both operational downtime and long-term reputational damage.

ProArch’s telemetry confirms that legacy MFA and perimeter security are insufficient against these evolving identity threats.

ProArch Recommendations: Strengthening Your Identity Security Posture

To mitigate identity-based threats, ProArch recommends the following actions:

Strengthen Authentication Controls

• Implement phishing-resistant MFA using FIDO2 hardware keys and number-matching verification.
• Disable legacy authentication protocols that bypass conditional access.

Enhance Visibility and Detection

• Integrate Microsoft Sentinel, MDE, and Defender for Identity for unified threat correlation.
• Enable UEBA to detect behavioral anomalies such as impossible travel or off-hours access.

Govern and Automate Identity

• Use Azure AD Privileged Identity Management (PIM) to enforce just-in-time access and periodic access reviews.
• Regularly review OAuth consents to prevent third-party abuse.

Build Resilience through Zero Trust

• Continuously validate user and device trust levels before granting access.
• Segment critical workloads and apply least-privilege principles across all user tiers.

Educate and Test

• Conduct phishing simulations and awareness programs to reduce user susceptibility.
• Schedule red team exercises focusing on MFA fatigue and token replay attack simulations.